Luxottica buys 36 percent of Salmoiraghi & Vigano

The Italian eywear giant Luxottica SpA (LUX, LUX.MI) said last week it has agreed to pay 45 million euros for a minority stake in Italian eyewear retail group Salmoiraghi & Vigano. The transaction is aimed at providing Salmoiraghi & Viganò

with the resources required to re-establish its financial resources and to support its future, explained Luxottica.

In a filing to the Italian stock exchange, the company said it will buy newly issued shares of Salmoiraghi & Vigano representing a 36 percent stake in the eyewear retailer.

Under the agreement, Luxottica and Salmoiraghi & Viganò Holding, commencing in 2017, will have the right to exercise a call option to acquire the shares both companies do not own. The transaction is subject to satisfaction of customary conditions, including obtaining regulatory approval in Italy.

“In the last few years, the Italian eyewear sector has undergone many important changes”, commented Andrea Guerra, Chief Executive Officer of Luxottica. “With this investment, we aim to provide the sector's leading Italian chain with additional resources and allow it to pursue its growth projects. Luxottica will become a financial partner while operations will remain with Salmoiraghi & Viganò. This transaction demonstrates our commitment to finding solutions for our business partners, providing concrete support to the market and looking optimistically to the future of our country”.

“This partnership,” added Dino Tabacchi, Chairman and major shareholder of Salmoiraghi & Viganò, “represents a great opportunity for our company, with its history dating back over 150 years and a network of approximately 500 sales outlets in Italy, to strengthen our brand in the Italian market. We are extremely delighted to enter into an arrangement with Luxottica, which will allow us to carry on with our company's development plans”.

Salmoiraghi & Vigano owns approximately 500 stores across Italy and its net sales for the fiscal year ended Sept. 30 stood at some 170 million euros, recalled ‘FoxBusiness’.

In the wake of the news, Luxottica Group SpA’s stock had its “accumulate” rating restated by equities researchers at Banca Akros in a report issued on 27 November. Meanwhile, analysts at AlphaValue reiterated a “sell” rating on shares of Luxottica Group SpA in a research note to investors on Thursday, November 22nd, having now a 32.69 dollars price target on the stock.

Luxottica Group SpA has a 52-week low of 20.3100 euros and a 52-week high of 30.8700 euros.